Grayslake is moving forward with potentially one of the largest single development projects in Lake County’s history, with a multi-billion-dollar data center campus that, if fully built out, would bring more than 10 million square feet of data center space to the village.
The massive project could bring thousands of jobs, new tax revenue, and millions of dollars in developer fees to Grayslake, but it also sits within a growing conversation around data centers in the Great Lakes region, as concerns over their water and energy usage increase.
Known as T5 @ Chicago IV, current plans show the campus comprised of 18 data center buildings, although T5 Data Centers CEO Pete Marin indicated there could be up to 20 buildings. The first buildings could be going up as soon as 2027, and full build-out could come as early as 2029.
Marin praised Gov. JB Pritzker’s support for the industry, saying the state needs to continue to “drive improvements that attract hyperscalers to Illinois.” The region is a “tier one market,” he said.
Marin said developers have secured 1.55 gigawatts of power from ComEd for the development, 1.2 gigawatts of which will be leasable power. They could build 20 two-story 60-megawatt data centers, Marin said, or perhaps several larger-footprint, 100 to 200 megawatt AI factory buildings. The campus will also include its own ComEd-built substation.
According to the U.S. Department of Energy, a single gigawatt is equivalent to the power of 100 million LED Bulbs, or 1.3 million horses. In fact, 1.21 gigawatts was the amount of power used in the “Back to the Future” films to send the DeLorean back through time.
According to Grayslake Mayor Elizabeth Davies, the property was previously open farmland owned by the Alter family, which also owns the Chicago Sky Women’s National Basketball Association team. The land is within the broader “central range,” an area in the southern portion of Grayslake that has been envisioned for development going back decades, or “property tax diversification,” as Davies put it.
The village has been “setting the table” for a development like T5 for years, Davies said, working to improve infrastructure in the central range, such as building a new water tower and helping expand Peterson Road. After the arrival of Medline just a few years ago, the “coal cart in the mine” has begun to move, Davies said.
If fully built out, T5 will bring 1,500 permanent positions, she said, as well as hundreds of construction and trade jobs during development. Numbers on the cost of the project vary. While Davies said it will be an $8.5 billion build, Marin said it could be as much as $12 billion to $18 billion.
Developer fees are still being negotiated for the T5 project, but could be in the tens of millions if fully built out, Davies said, although she cautioned that exact numbers are not nailed down yet, and could only give rough ballpark figures.
In broad strokes, she said the village plans to use 25% of fees for resident cost-control measures, perhaps by reducing various fees, 25% for special community projects, and the remaining 50% for larger, major projects, including big infrastructure items.
For the Grayslake community, Marin argued data centers are low-impact, high-investment assets, producing tax revenue while having little to no impact on local infrastructure such as roads.
Demand for data centers is “off the charts,” he said, and likely to remain.
Water and power
One of the primary points of discussion regarding data centers is their use of water for cooling, with growing demand from data centers and other water-heavy users such as agriculture setting the stage for potential shortages and future conflict, according to recent reports.
T5 won’t directly increase water usage in the area. Marin said the campus will utilize air-cooled chillers. The system, once filled with water and coolant, doesn’t need to be refilled and won’t consume much water, he said, comparing it to the radiator in a car.
Davies said Grayslake residents won’t see any impacts regarding water or power from the development.
“These data centers will make no difference to us than if they were anywhere in the five-state region,” she said.
But even without plugging into municipal water for cooling, Helena Volzer, senior source water policy manager at the Alliance for the Great Lakes, said there are still costs. Cooling methods that don’t use water require more electricity, simply moving the water consumption to the power plant generating the energy.
And some organizations are pointing to the increase in data centers as one of the drivers behind rising electricity prices in the region. The nonprofit Citizens Utility Board, which tracks electricity prices in Illinois, said ComEd’s supply price is about 47% higher than last year in a news release earlier this month.
“Capacity costs have skyrocketed largely because of increased energy demand from data centers and policy problems with the power grid operator for northern Illinois, PJM Interconnection, which runs an auction to determine the price of capacity,” the release said.
On the state level, Volzer said there is a push for new policies to address transparency issues with data centers and water usage. How much of the water use required to generate energy is being driven by data centers? And as groundwater resources face increasing pressure, the state’s management laws aren’t prepared to limit or curb usage before there’s an adverse resource impact, she said.
Volzer said the Alliance wasn’t opposed to such developments, if water is “holistically considered as part of the equation,” but Illinois needs “to be considering water,” conducting more regional plan studies to see where water is available and balancing laws around groundwater management laws and public water supplies.
In a statement, a CUB representative also pushed for state-level regulations, urging the passing of the Clean and Reliable Grid Affordability Act.
“There’s a lot of work to do to meet the challenges that arise from data center energy demand, but a first step is the CRGA Act, which would help alleviate the supply/demand crunch by expanding energy efficiency programs and bringing more battery storage to the grid,” the statement said.
Dan Diorio, vice president of state policy for the Data Center Coalition, said the industry is “really cognizant” of energy and resource efficiency, and “actively pursuing” sustainable water designs. On the energy side, Diorio said data centers are “fully committed to paying their full cost of service.”
Diorio emphasized the “overall economic value” of data centers, which he said bring in numerous trade jobs to support them and generate property taxes to help improve the community.
“This is an industry that’s committed to the state and committed to energy and water and resource responsible management,” Diorio said.
For Marin, the broader issue centers more around energy production. Data centers are one of many things putting pressure on the grid today, he said, but the increased need will push innovation.
“The countries that embrace energy development and deployment are going to win,” Marin said. “We’re at a point where industry has caught up with energy generation.”